Forget Alpha: Billionaires Deliver Bedlam Warnings Instead!

Yesterday was CNBC’s annual “Delivering Alpha” conference at the Pierre Hotel in New York City. It brought together billionaire hedge fund managers, corporate raiders, pension fund investors, and current and former Treasury Secretaries.

But rather than serve up a bunch of bullishness or juicy stock tips, the billionaires who attended delivered warnings of bedlam instead!

Ray Dalio, chairman of the world’s biggest hedge fund, Bridgewater Associates (with $150 billion under management), said: “The risks are so much more on the downside” that the Federal Reserve can’t raise rates, adding “we’ve never been in a world that’s like this.”

Paul Singer, founder of the $27 billion hedge fund firm Elliott Management, was even gloomier, saying: “Eight years of ever-declining rates and ever-increasing radicalism in other monetary policies have not created a sustainable, accelerating uptick in growth. What they have done is created a tremendous increase in hidden risk … I think it’s a very dangerous time in the global economy and global financial markets.”

Dire warnings for the markets.

Billionaire Carl Icahn sounded yet another alarm when he took the stage, saying: “You look at the environment, and I think it’s very dangerous. You’re walking on a ledge and you might make it to the end, but you fall off that ledge and you’re really going to see trouble.” Icahn added that it doesn’t really matter whether the Fed hikes rates this year or not next year, “because either way there’s a problem.”

These aren’t the first such warnings from noted billionaires or fund managers, of course. Icahn has been saying for the past year that stocks are in big trouble. What’s different is the frequency, urgency, and magnitude of the warnings.

Everyone from Sam Zell to George Soros to Stanley Druckenmiller has piled on in recent months. And of course, CEO Jeffrey Gundlach at DoubleLine Capital (a firm with more than $100 billion in assets) recently said the best advice may be to “Sell Everything.”

I don’t blindly follow anyone in the investment world. I do my own analysis and research. Then I arrive at what I consider to be the best conclusions – and recommend investments designed to help you profit from them.

“Icahn has been saying for the past year that stocks are in big trouble.”

But as I’ve said before, these investors didn’t become legends in the business … or build up multibillion-dollar war chests … by making a bunch of dumb investment moves. They are genuinely worried about the mess we’re in as a result of economic stagnation domestically and bubble-blowing behavior by central bankers around the world. So that’s another reason why I continue to maintain a cautious investment stance – and recommend you do, too.

With that in mind, let me again ask the question I posed earlier this year: Are these billionaires on to something? Should you heed their warnings? Or are you getting sick of hearing them? What are your friends, family members, or investment advisers saying? Do they think now is a good time to invest, or are they urging caution? Hit up the comment section and let me know.

Our Readers Speak

In the meantime, the ping-pong match in the markets continues, with big rallies and big sell-offs becoming the norm after a period of extraordinary calm. I’ve offered my take about where I expect markets to head next (lower). Now, I wanted to share some of your comments.

Reader Steve S. said he thinks stocks may be peaking: “As the old Wall Street saying goes: ‘They don’t ring a bell at the top.’ We may be seeing the beginning pop of the asset bubbles in stocks and bonds that have been created by central bank money printing. When the hedge funds and momentum players want to sell, who will want to buy?”

Reader John said the backdrop is difficult to analyze: “I think there is no playbook to understand the current economic environment. I think that the financial markets will continue to have calm periods, and then large volatility, and then calm again.

“This will continue until we get certainty and clarity around the U.S. presidential election, Brexit, and QE scale and duration. The strategy should be to trade the bumps and to make small gains regularly.”

Reader Thomas added this view on how to make money in this turbulent environment: “Crystal ball investment strategies based on good old-fashioned technical and fundamental analysis have become obsolete, out of the window so to speak. Thanks to central bank intervention, the new norm these days is to trade defensive with hedging strategies capable of producing a profit, no matter which way the market will go.

“To do this effectively, we need to think and act like market makers do. That is a skill set on its own, with new rules and tactics to make sure we do not lose our shirts (and pants) in the process.”

As for which parts of the market should underperform or outperform, Reader Al said: “I certainly agree with emerging markets and infrastructure. The emerging markets are in worse shape than the U.S. markets in terms of debt and growth as a result of debt.

“Infrastructure benefits from either a Trump or Clinton win domestically. Defense spending will increase domestically and internationally, with U.S. defense purchases from abroad on the increase due to China’s recent behavior in the region and rogue countries like North Korea.”

Lastly, Reader Dr. Dave weighed in on the scandal at Wells Fargo and the hefty payout its consumer banking head is walking away with: “Yet again we are shown that banks are beyond the law. If I pulled this type of fraud in my business and was found out, the only thing I would see is the inside of a jail cell. Apparently the justice system is skewed — the more you have, the more you get away with.”

Thanks for weighing in. Dave is absolutely right about the big banks. Over and over, they get nailed for fraudulent or sketchy behavior … and over and over, the executives who are or should be responsible for it skate. I have no idea when that will change, but I do know that it continues to outrage many average Americans.

As for the markets, what can I say? Intense volatility after an unnaturally long period of calm sure looks like a trend change signal to me. We’ve already seen two mini-meltdowns in the stock market last August/September and this January/February. It’s entirely possible we’re on the cusp of another, as billionaires like Icahn and Singer are warning about. Those key technical levels (2,100 on the S&P 500, 18,000 on the Dow) I mentioned earlier this week are the ones to watch.

Other Developments of the Day

Facing a slowdown in demand, buildup in inventories, and a surge in profit-crushing incentive use, Ford Motor (F)just warned that 2017 results will be worse than those in 2016. Ford also blamed the cost of investing in technologies like electric cars and autonomous vehicles for the profit warning.

LIBOR rates continue to climb inexorably, regardless of what Fed policymakers say or do. In fact, these key benchmarks used to price corporate loans, derivatives, and adjustable rate mortgages are hitting new highs that date all the way back to 2009.

Some of the blame lies with changes in money market fund regulations, which could lead to as much as $300 billion being yanked from funds that invest in short-term corporate loans. But is something else afoot? A surge in worries about corporate credit quality? That’s the direction I’m leaning given the magnitude and duration of this move higher. Stay tuned!

It’s official – Bayer AG of Germany is going to buyMonsanto (MON) for $57 billion, or $128 per share. The move will create a behemoth in the agrichemicals and seed business. It’s also the largest-ever cross-border takeover by a German company.

So what do you think about Ford’s earnings warning, and the prospects for the auto sector overall? Are its best days behind us, and what does that mean for stocks and the economy? What about the rise in LIBOR rates? Is it a major market worry? Or will ongoing M&A transactions, like the Bayer-Monsanto tie up, help support stock prices? You know where to weigh in, and I hope you take the time to do so.

Until next time,

Mike Larson

Mike Larson graduated from Boston University with a B.S. degree in Journalism and a B.A. degree in English in 1998, and went to work for Bankrate.com. There, he learned the mortgage and interest rates markets inside and out. Mike then joined Weiss Research in 2001. He is the editor of Safe Money Report. He is often quoted by the Washington Post, Reuters, Dow Jones Newswires, Orlando Sentinel, Palm Beach Post and Sun-Sentinel, and he has appeared on CNN, Bloomberg Television and CNBC.

{68 comments }

I think I'll buy...Wednesday, September 14, 2016 at 4:58 pm

With all of these heavyweights on one side of the boat, I think I’ll get on the other side. Time to buy.

David C.Thursday, September 15, 2016 at 1:51 pm

I agree, is there anyone out there that isn’t ‘really worried’ which means they have probably sold, and aren’t some of these guys hugely short the market too, is it possible they are “talking their book”, no, they wouldn’t do that would they !

I am not buying but I have sold PUTs on stocks I like.

$1,000goldThursday, September 15, 2016 at 10:06 pm

i bought a little yesterday too.

$1,000goldThursday, September 15, 2016 at 10:08 pm

larson seems to think it’s the 1937 crash all over again. he might be right.

Old BullfrogWednesday, September 14, 2016 at 5:03 pm

My comments remain the same: we are beginning to reap the fallout from endless and mindless world wide central bank manipulation. Not only hasn’t this accomplished anything excep tfor the creation of various asset bubbles, but there’s also no exit plan at hand. Eventually the real market place always wins !!!

Bob DrummondThursday, September 15, 2016 at 10:29 am

There is an exit plan, its just that the likes of us are not included

Alexander VagoFriday, September 16, 2016 at 9:12 pm

…seems we must make our own “exits”, despite these titans (who have some entirely different “options” open to them…). Thanks for the wry words of wisdom Bob! ;)

richard feibelSaturday, September 17, 2016 at 8:22 am

congratulations you get it.and watch who jumps in an buys the scraps and make trillions!!!

BruceWednesday, September 14, 2016 at 5:03 pm

My advisors are telling me that the US economy is on sound footing and that they believe we are in a secular bull market.

Bob DrummondThursday, September 15, 2016 at 10:31 am

Advisers advise investors to earn a living, they don’t invest.

GraceThursday, September 15, 2016 at 5:19 pm

Are you being facetious? I hope not, because that thought always occurs to me. Will see after the general elections.

anthony gWednesday, September 14, 2016 at 5:09 pm

The artificial growth can evaporate over night. The billionaires are right on target. The central bank short cut will lead to disaster.

peterWednesday, September 14, 2016 at 5:10 pm

Most of the billionaires are talking their own book. It is indeed a very risky environment but the decline they are looking for won’t happen until the average investor become really scared. Behavioral Finance models that measure fear and greed just aren’t agreeing with them yet…..

Bob DrummondThursday, September 15, 2016 at 10:33 am

You can leave Krakatoa one year before or one minute after, the choice is yours.

Alexander VagoFriday, September 16, 2016 at 9:14 pm

Appreciate your insightful comment Peter!

ianWednesday, September 14, 2016 at 5:16 pm

Listen to what or who,do YOU see a rosey picture,I see blood,just hope everybody is prepared,hope Im wrong.Social security deep trouble,pension schemes short,.God help the next President,well done BO and they call you intelligent.Rates cannot go up but must.

Chuck BurtonWednesday, September 14, 2016 at 5:19 pm

So Monsanto is being bought by Bayer. Just another in the disappearance of American companies, as they are increasingly being taken over by foreign owners. I wonder how much of that is the result of the actions of American politicians, making things difficult for companies to remain profitable in the land of the supposedly free.

Alexander VagoFriday, September 16, 2016 at 9:18 pm

Thoughts to ponder upon…thanks for the insightful comment Chuck!

richard feibelSaturday, September 17, 2016 at 8:32 am

you have to kidding !! evidently you are unaware of monsanto ,bus.plan.they are the corp juicing 3rd world countries with their gmo garbage.an american co,my tochus!! bayer is I G FARBEN recognize that name?/they bought monsanto for its bus.plan and patents.

EDWIN jOHNSONWednesday, September 14, 2016 at 5:43 pm

My big concern is Sept 30,2016 when a new monetary currency replaces the U.S. dollar-
have you heard about this? Obviously, a blow to the stock market as well as the U.S. economy.

ScottWednesday, September 14, 2016 at 5:50 pm

good now we can sue a German company ,are the EU like they’d love to sue us the usa.that crooked monsanto bunch thats poison every human that ever ate food from the seeds that they have manufactured.oh by the way whatever happened to the monopoly bill

Joe GersteinWednesday, September 14, 2016 at 5:54 pm

It is somewhat curious that all these behemoth investors are willing to give free advice to anyone willing to listen. If they have bailed out of stocks, dispenbsing with this advice is likely to depress the prices so they can buy in again. Is this just paranoid conspiracy theorizing or simple logic?

linda griffithWednesday, September 14, 2016 at 5:55 pm

If the stock market is in such “big trouble” why won’t the Fed let it correct? huh? for more than an hour? I am so sick of these baseless stick saves.

Stephen LukeThursday, September 15, 2016 at 3:44 pm

Spot-on Linda! How dare the FED let this market correct in an election season. If Trump wins the Dems will scorch the earth.

Mick J.Saturday, September 17, 2016 at 1:47 pm

…..Woe Is Me…..we are all gonna die.
A market correction….. apocalyptic.

Germanico VacaWednesday, September 14, 2016 at 5:59 pm

I simply wanted to say how much admire all the wonderful work you have done. However, I want to ask you to read my plan and maybe you should recommend it to those fund managers. I truly believe that my plan is a game changer. If Donald Trump is talking about building a wall, I believe we need to build my project because just its existence will drive thousands of people to seek jobs in all the countries that implement my plan and not in the USA, while American companies will benefit tremendously of building infrastructure, providing logistics, technology, financing and resourceshttp://integraldevelopmentplan.blogspot.com/2015/04/comprehensive-development-plan-for.html

I will be very grateful if you take the time to read my plan, we should have the vision of what the future should be: Cooperation, expansion and development of the whole continent as leader of the free world and not an oppressive state that hunts people down and build walls. That will be to abandon the principles under which this nation was founded upon.

Sincerely
Germanico P Vaca

HapunaWednesday, September 14, 2016 at 6:03 pm

Anyone with a way to connect to the Internet knows that a storm is brewing. It is not just the investment world that is close to blowing, it is the political scene and the entire financial spectrum. There is almost no wiggle room left. Soon the crash will occur and with it fortunes will be lost and a few gained. I am on the short side right now. Plus I am holding a larger proportion of cash and equivalents. The everything bubble is actively searching for a pin.
It is very scary right now. If you want to invest in something I suggest investing in tangible goods only. And I do not mean fancy cars or fine wines. No. Invest in things people can not live without. Things that you can not live without.
Don’t try to guess when the bubble will pop. Just know it will and invest accordingly.
Aloha,
Hapuna

Alexander VagoFriday, September 16, 2016 at 9:25 pm

Thank you for the thoughtful comment Hapuna… “Aloha!” (You lucky man in Paradise!)

Mick J.Saturday, September 17, 2016 at 1:52 pm

Oddly enough…I have an acquaintance that’s telling me the same thing….kinda…his advice to me was to invest in precious metals. Good advice…indeed. But….then he added silver ETF’s…or something like that. Well….I’m no brainiac in this field, but thanks to good genes, and a good helping of common sense…I asked him what good a piece of paper is gonna do me when it all goes *POP*….. he just scratched his head.

billWednesday, September 14, 2016 at 6:35 pm

This is about Dr. Dave’s comment. Hillary and Banks are above the law.

JDWednesday, September 14, 2016 at 6:42 pm

“Are these billionaires on to something? Should you heed their warnings?”
I think it’s foolish to ignore that many experts all saying the same thing. I can’t believe it hadn’t imploded 2 years ago. What worries me is being invested, even with the great guidance we’re getting, and not being able to get out in time….basically a replay of the Fall of 2008. When the big boys decide to take their chips off the table it will be fast and furious and the little guys will be blocked out of trades and left holding the bag. My question to the Weiss folks, How will you help us avoid that scenario?
As for friends, the advice they’re getting is basically all diversify, buy and hold. I don’t know of any that feel they can afford to get out early as a safety factor. Or, they don’t believe me when I share the risks. Besides myself, I only know of 1 or 2 others who are either completely out of the market for the past 2-3 years or are substantially out, to the tune of 75%.

Bob DrummondThursday, September 15, 2016 at 10:39 am

You can’t save souls, you can only save stamps.

Alexander VagoFriday, September 16, 2016 at 9:27 pm

…uh, do you mean “blue chip” stamps Bob? (Thanks for the chuckle!)

Gregory ChaneyWednesday, September 14, 2016 at 6:54 pm

I for one am sick to death of the doom and gloom predictions. Th economy, the markets, the governments, the bankers, lies all lies and deceit. They will hang on to power and control by any means. So stop fretting..they’ll print money as needed. Need more gold and silver??? Hell just print some more ETFs. See the illusion continues. No worries. But the govt better print some more phony money and get 10k of so into the hands of the hungry and broke people and I mean NOW because I sense an impending degradation of social order. Many others do too. I’m dead serious. I’m damn near afraid to drive my Benz very far from my nice gated community. I’ve been held up twice, once the man said he was sorry but he was out of options and he had nowhere to turn. I gave him my wallet and he took the 2 or 3 hundred dollars I had and handed me my wallet back and said he wouldn’t take the wallet because he knew how hard it was to replace all the cards and ID. Bad things are afoot. Sincerely: Greg Chaney

PoppyFriday, September 16, 2016 at 7:24 am

Degradation of social order is a huge worry. The storm troops are organized and well funded. BHO becomes more dangerous out of office than as Pres.

Alexander VagoFriday, September 16, 2016 at 9:40 pm

Appreciation for your sincere comments Gregory—God Bless!

Bill McInnisWednesday, September 14, 2016 at 7:08 pm

With all the major indexes at all time highs and interest rates at all time lows and growth slowing to a standstill you can see deflation on the horizon. This will hit us harder than a tidal wave without warning, so prepare for some turbulence ahead by having some liquidity set aside, and as always stick to quality assets.

joeWednesday, September 14, 2016 at 7:09 pm

The big boys are trying to talk down their shorts and to use the media to soften prices for long entry points. Age old manipulation game. They have been short for over a year and are mostly underwater. Some have been in cash over a year missing the rally to new highs. Of course they want to get in at lower prices. Most of them make little for their clients except the convertible bond fund hedgies who tend to achieve consistent returns. Will they tank the markets occasionally to create their raider pricing. Yep. Just use prudent risk management parameters and use their manipulation to your advantage. My biggest fear is having another republican “business man” president to march the country into our third depression. The amnesia of where we were in ’08-’09 under repub devastation is perplexing. Of course the vultures want to do it again. Trump bragged about buying up peoples hopes and dreams then. Next time he and his family and cronies will have piles of foreign gangster money to do it to America again.

bob sterThursday, September 15, 2016 at 9:42 am

yes but the air pumping up this ballooned stock market must continue supposed unsustainable growth and 1.7 GDP just doesn’t cut it .. No matter who wins in November i believe that the Dow is over bought against next years earnings .. however , DOW 14 Thousand might be an excellent buying opportunity once again .. The FED raising rates is the real ruse because they probably sense poor earnings next year .. They have no other defense and might need some bullets to off sett some disastrous fall in the markets should it happen hence , the rate raise .. because there is no inflation out there with half the people out of work or making a great deal less than previous employment .
Meanwhile,, lets “stay long until were wrong ” because a year ago JP Morgan said sell into the rallies and so far its been more like buying the dips that has been better advice and more profitable if your in the nifty fifty .. .
bob ster

Mike B.Wednesday, September 14, 2016 at 7:48 pm

This entire mess was doomed September 2008 with the “fix”; natural market forces were not allowed to do their work in repairing themselves. Then, it continued in 2009, and that is when it really started; i.e., basic, sound fundamental analysis no longer worked. The only thing that mattered for the next 7 years was whether or not the FED was going to pump more “Heroin” money into the system. “Manipulation” of ANYTHING always ends badly and these markets have been manipulated to a point of no return. This will end badly and we are probably going to witness the biggest transfer of wealth ever experienced since we began walking upright. The risk/reward of being long anything just isn’t worth it. Anyone buying ANY kind of debt instrument is going to lose a considerable amount of their principle; think of a full gymnasium of spectators and all the doors except for one are chained shut; what happens when the fire starts and everyone tries to exit through one door? 99% of them cannot get out, they all get burned; this is what you will see in the bond markets when a couple major players decide they’ve had enough and aren’t willing to play the chicken game at these ridiculously elevated bond price levels. Once the selling starts, no one will be able to get out of their positions because there will be no buyers. Prices will probably go down at least 50% overnight, probably more. I remember when I was a broker in the early 80’s, bond prices got down to around 48.00 (I think, but I’m old and memory might not be serving right, but I’m close); we were recently up to 177.00+ on the long bond. What do you think is going to happen to anyone in at the 100 – 175 levels? They will lose at least 50% of their principle overnight. Anybody thinking that the FED can backstop the bond market is an idiot. The FED will be totally overwhelmed once the selling starts and will not be able to do anything. Stocks? well, Mike has already beat that drum continuously since turning last summer. I think he’s 110% correct. These companies have been bleeding red for a couple years now. Again, this WILL end badly; remember
“Amat victoria Praeparatio” or in our tongue, “Victory Loves Preparation”. But, global money flows could have a significant impact on our stock market; this remains to be seen. Make sure YOU are prepared; you and your families’ existence will depend on it.

Chuck BurtonWednesday, September 14, 2016 at 7:52 pm

An item in the debt bubble universe: American credit card debt topped $34.4 Billion in the second quarter of 2016 – a new record. It is expected to top $1 Trillion for the year – also a record. Americans seem to be spending like happy days are here again, but using money they don’t have to do it. What happens when everyone declares bankruptcy? Will the Fed print a save for the banks again?

badger10Wednesday, September 14, 2016 at 8:15 pm

Trade with caution as market is fairly valued at these levels.

GeorgeWednesday, September 14, 2016 at 8:40 pm

I believe the housing market is about to tank not from the data the financial channels or the government. I get my data reading the local small town paper. Foreclosures had gone from one half page less than one year ago to over three pages in the most recent paper. Just a note, our county has the highest median income and the best education system in the state.

David LewtonWednesday, September 14, 2016 at 9:00 pm

i.e. Your item on Bayer AG purchasing Monsanto — the glyphosate/Roundup Ready herbicide technology, corn syrup sweeteners, terminal cross seed technology, etc, etc are exposing Monsanto to potencial multi-billions of dollars of fines, penalties and class-action lawsuits. Try, on the other hand, suing a foreign corporation and see how long that drags out! The glyphosate/Roundup Ready technologyr is a particular problem, as there are fears of increasing weed resistance making this herbicides obsolete. Just my opinion, do your own research.

Francisco DuenasWednesday, September 14, 2016 at 9:01 pm

Amazing, how you let these rapists of the hook. These individuals shorted countries, pls livelihoods simply because they had the money and could do it,; and now they come in yelling and screaming? ??? This feels like the Twilight zone. Good grief

barbutoWednesday, September 14, 2016 at 9:14 pm

Its all fixed. The Congressmen and Senators are “in” to where the economy is going. Just read the books ” Advise and Dissent” by former SD Senator Abourezek, the first Arab American to get voted in the Senate. Then there is ” Throw them all out”….an expose, using SEC trading filing documents that shows how our “representatives”…..have ripped off the US taxpayer with their inside information and deals…SHOCKING….the fact that no one paid for the stock collapses of 2008, except us poor slob investors…proved that Wall Street had their in with gov’t. In fact many Wall Street businessmen, left Wall street to become Gov’t employees and advisors…!!!!..Too big to fail?…..Not true in a TRUE Capitalistic country, but in Crony Capitalist USA,….that’s the rule…..Size matters, and the Big guys pay off the politicians…..
The Military Industrial complex is running the gov’t using stooges like Obama and The Clintons. The Clintons have been making deals for 20+ years with their Clinton Foundation. Hilary must have a very thick “black book”…….”,,,Uh,…now lets see…I have to go to Zambia next week…..WHAT DID I PROMISE THEM, BACK IN 2010?….hMMM…THEY OnLY PAID $10 mILLION?…..WELL,… &^%$ THEM…..THEY CAN…*&…*&…*&^…”…!!
When the US economy collapses,,,,the 1%ers will have their escape plan and will govern over the masses who will be hurting….very badly. I am glad I am an old man…maybe I will die before it all comes to pass…Too bad for my kids and grandkids….

MikeWednesday, September 14, 2016 at 9:18 pm

I found it very strange that just as the Fed needs to unload government securities, the rules get changed to guess what? Encourage money market funds to have favorable treatment if they buy government securities. It smells.

frederick mcquiggWednesday, September 14, 2016 at 10:04 pm

bayer has screwed itself. this will go down as one of the most expensive fliers taken by supposedly conservative German’s based on arrogance. their markets are the target of a new generation of EU regulators who will kill the international business

Alexander VagoFriday, September 16, 2016 at 10:10 pm

Thank you for incisive comment Frederick!

BonnieWednesday, September 14, 2016 at 11:09 pm

If stocks are not the answer, then what is? I have to fund a SEP-IRA by Sept 15 but perplexed as to what direction I should turn. Any ideas? Vanguard?

AshJMWednesday, September 14, 2016 at 11:10 pm

I think the driverless car will have a massive impact on the car industry as a whole. The first Co’s to perfect it will sit pretty, the others struggle. A 3 car family will become a 1 car family, as Dad goes to work, sends the car home so Mum can take the kids to school, or older kids get a ride to Uni and send the car home again for whoever wants it next. This may occur far sooner than we would have thought only a few years ago.

Mick J.Saturday, September 17, 2016 at 2:02 pm

What a grand idea….send the car home…..wow. I wonder if that will be possible. Or will it be a law…or tech issue, that someone has to be in the darn thing. We live in interesting times…indeed.

Carol AndersonWednesday, September 14, 2016 at 11:15 pm

I find the sale of MON to Bayer AG worthy of watching. MON is my least favorite corporation due to its on-going ‘poisoning’ our food supply with their ‘growth chemicals,’ not to mention pesticides. Many farmers are making the switch back to organic farming and I even see ads from them asking us to please buy cereals created in the midst of this process of change. That its a process that will take time. Most or all of Europe will not accept our GMO food products as imports. So now, what will Bayer AG do? Hopefully, they will keep doing what they do best and not become part of the problem.

Thomas BommaritoThursday, September 15, 2016 at 12:10 am

I’ve decided to follow Edelson’s philosophy. Sure hope he’s right.

Mikel L.Thursday, September 15, 2016 at 2:51 am

Don’t rising LIBOR rates indicate their needs to be a risk premium on debt, both private and public? Janet can’t can it, if investors/lenders begin to say “Hey, wait a minute, the overload of debt requires a risk premium when you want to borrow more!” Besides, perhaps they remember a while back Will Rogers said: “I’m not so worried about the return on my money as I am about the return of my money!” Rising rates might help sort out who is more likely to return the money. Wasn’t the world in kind of a financial jam when Mr. Rogers made that statement?

P.S.-Don’t confuse this Mr. Rogers with the “It’s a nice day in the neighborhood…” guy-because it’s not!

Alexander VagoFriday, September 16, 2016 at 10:08 pm

;) ….Think the world would be a better place with either “Mr. Rogers” in charge Mikel…Thank you for insightful (and humourous comment) :)

Albert E. Gilding Sr.Thursday, September 15, 2016 at 3:11 am

I’m not a trader, but have invested in the past. I removed myself from the market entirely just short of the big decline of 08 on the advice of an intelligence so far greater than mine there is no apt comparison. Most of my current information comes from advice letters like this one, and the news has been so bad that I daily thank God that I followed such a sterling warning.
Now if all the “Big Boys” feel like they are just “skating” away from responsibility, I have news for them. The ice they are skating on is thin because of their “make-a-buck” at all costs no matter who else gets hurt, it’s all about me” attitude. The collusion between them and liberal government seems to be bringing on an economic collapse that dwarfs any past event, even going back to the long-ago Dutch Tulip fiasco, that should have taught a lasting lesson about personal averise. Evidently history will be required to repeat itself again and again and again until the lesson is finally learned or the student (s) collapse from economic exhaustion or internal combustion.
Another Al, Gilding

Alexander VagoFriday, September 16, 2016 at 10:01 pm

Appreciation for your comments Albert…God Bless!

A Private NewYorkTraderThursday, September 15, 2016 at 4:40 am

Stop blaming the Fed; someone involved with the Fed demanded QE be stopped and that saved America which is clearly seen thru events unfolding in Europe! Why we complain about the strong dollar when currency could falter under this climate I will never know… Our real problems are significant negative economy trading, you know that reverse PE ratio robo-stuff which is finding the only money left in companies with real asset value and relieving it by driving down its price with massive short trading. Surely, money fund managers are better than that or they should be… There will be a cost for negative economic trades: “robo shorts” — the question is will an equity market collapse be it?

Mike C.Thursday, September 15, 2016 at 6:25 am

It’s hard for me to trust the forecasts of these Billionaires given their records of always talking their book. That said, I have the same concerns, but think that the time line for these negative events will stretch out a little further into the future. Strangely enough, the US is still viewed by many as a safe harbor for money (it shouldn’t be, but it is nonetheless). Given that other industrialized nations are sinking quicker than the US, it seems that more foreign money may still be in bound to our markets. How long? Anyone’s guess, and almost any kind of “black swan” event could topple everything into the abyss. If you must be invested (for whatever reason), I say to stay with the safest of the blue chip dividend payers, and put hedges in place to offset market value drops in price. Other than that …. Pray (that’s what we’ve been reduced to).

WasteLand WarriorThursday, September 15, 2016 at 7:55 am

That’s all the human race needs!! Two greedy, immoral, ruthless, psychopathic corporations getting together to control even more of our food supply and poison us even more with their chemicals for profit!. This capitalist system is broken, it is not capitalism anymore, it is a system to create super-monopolies in every industry until there is no competition and they dictate what we do how we do it and what products we use, and they set the price, as without true competition they can and will. Corporations have been proven to behave like psychopathic people, with no remorse and no consideration for people or the environment or anything else other than profits. (See the documentary “The Corporation”)..I’m all for a freemarket system, but what we have is not that, the big destroy the small up and coming businesses, most of which have better or more friendly ideas, products and would make our lives better, AND give the big guys much needed “real” competition, but they are eliminated or driven out of business..And they have lobbied and payed off our governements which are supposed to protect us to instead pass laws that protect them and their selfish interests…If this continues, in 10 years there will ONLY be supermonopolies in charge of every major industry on this planet controling our lives and our governements even more, we won’t need dictators to control it… Hopefully the coming economic crash and meltdown will reset the system into something better for humanity.

DisaffectedDemThursday, September 15, 2016 at 11:15 pm

You’re right, WasteLand Warrior. Except the problem with the “freemarket system” is: when it starts with small businesses – which it did – eventually they compete for market share and the winners gobble up the losers. Teddy Roosevelt tried to put the brakes on the process, but the anti-trust regulators have long since been defeated, rarely utter a peep as nearly all industries are concentrated fewer and fewer hands. We are looking at capitalism devolving into a new feudalism. Or is that what fascism is? The state becoming one with the corporations?

WasteLand WarriorFriday, September 16, 2016 at 1:07 pm

I’m afraid you are right. until we change human nature it will always be the same no matter what system we come up with, as it has always been throughout history. Problem is that now we have the technology to obliterate the entire liveable planet when the powerplayers get frustrated and “flip the game board”… So sad, as it really is/was a nice planet..oh well! I hope the next civilization that will come around in thousands of years gets it better that we did…

gordonThursday, September 15, 2016 at 11:17 am

The beginning of a Black Swan event?? This weeks Global Greed award goes to Google who is under investigation by Indonesia for same reason as Apple in Ireland. More and more countries are going after these big cash rich turkeys for avoiding taxes and it looks like it could turn into a real turkey shoot sorry Black Swan event. Yes you get the same old “we will defend ourselves vigorously” crap. This type of investigation is a trickle right now but could turn into a flood shortly as these countries smell blood. I guess Google now to will be rushing to repatriate all their “abroad” money back to the US shores. I guess the US will soon be sounding off like they did in Ireland as they seen the cream being skimmed off of their financial pie that they were so looking forward to returning into their tax fold. As an after thought Legarde the head of the IMF is facing a trial in December. As she is facing a trial she should automatically preclude herself from any more IMF involvement but she obviously is not. Arrogance knows no boundrys it seems.

Mrs. Asa B Groves Jr.Thursday, September 15, 2016 at 5:22 pm

At 92 years of age I just say “if you can’t say something good–it’s time to change jobs,

BY reading fine investment letters like yours in the past ,I was able to sell out and profit from the 2008 crash. As bad as it was,I thought it would be worse but all that funny money slowed the decline but did not alter the course to recovery.. The cycle was not allowed to complete itself ie eight years of lousy GDP growth. Yes,the cycle must be completed,what I call a cleansing of the markets so to start another expansion phase. As you mentioned,more and more people are coming aboard with this attitude.

DannySaturday, September 17, 2016 at 3:03 pm

What will happen to all the Billionaires and Billionaire Investment funds if they heed each others advice and start to sell?